Below is a high-level technical analysis of the Nifty 50 chart, focusing on the Elliott Wave labels and Fibonacci levels. Please note this is for educational purposes only and not financial advice.
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1. Overall Elliott Wave Structure
From the chart annotations, it looks like nifty is following a five-wave impulse sequence (Waves 1 through 5), followed by a corrective phase (often labeled A-B-C). Here are some key observations:
1. Wave 1
Begins near the major COVID low in 2020 (around 7,500–8,000 on the Nifty).
Ends in the 18500- 18600 region.
This wave laid the foundation for the post-COVID rally.
2. Wave 2
A corrective pullback that retraced a portion of Wave 1.
On the chart, it bottoms roughly in the 15,000 area that also coincide with 1.618 golden ration on Fibboncci levels before the market turns up again.
3. Wave 3
Typically the most powerful and extended wave in Elliott Wave theory.
According to the labels, it runs from ~15,000 up to ~26300.
This move is often accompanied by strong momentum and increased volume.
4. Wave 4
A corrective wave that retraces part of Wave 3.
Market is trading in this wave right now.
~ Fibonacci levels of 1.618 golden ratio in this wave is at 20800, it also coincide with a gap on daily, weekly chart at 20284-20500, which could act as upside price objectives if a new impulse wave starts.
It can act as support and bottom before the market turns up again.
5. Wave 5
The final leg of the larger impulse, reaching new highs but often with weaker momentum than Wave 3.
It can top around 32000-33000 region near Fibonacci level 2.
After Wave 5 concludes, the index typically enters an A-B-C corrective pattern ( you have potential corrective targets in the 15,000–16,000 zone, or deeper if the market is weaker.
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3. Possible Scenarios Going Forward
1. Bullish Continuation
If the index holds above key support (the prior Wave 4 zone near 20300-20800) and starts moving impulsively higher, it could signal the start of a new five-wave sequence.
Potential upside levels (based on Fibonacci extensions) could be 32000–33,000 if momentum remains strong.
2. Deeper Correction
Should the index lose major support (e.g., below 20200), a deeper corrective wave could target the 14700 area or even lower, matching the 61.8% retracement of the entire rally.
This scenario would imply a more prolonged consolidation phase before any new bull wave.
3. Sideways/Complex Correction
The market can also enter a complex corrective pattern (like a combination or expanded flat).
This could mean choppy price action in the 18500–20500 range for an extended period before a clear breakout.
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4. Key Levels to Watch
16500–17500: Prior Wave 3 region and a major pivot zone.
14,000: Deeper support from previous corrections.
20,300 and 23,000+: Upside extension targets if the next impulsive rally takes hold.
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5. Risk Management and Confirmation
Confirmation of Trend: Watch for reversal from 20300-20500 that also coincide with election result lows near 21300. A decisive close above these levels with strong volume often confirms a new bullish impulse.
Invalidation Levels: A sustained break below 20000 could invalidate the bullish wave count in the near term, implying a larger corrective pattern.
Momentum Indicators: Tools like RSI, MACD, or stochastics can help confirm whether a wave is impulsive (strong momentum) or corrective (weaker momentum, divergences).
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Final Thoughts
The Elliott Wave count on the chart suggests that Nifty is at a pivotal juncture—either preparing for a new upward impulsive wave or heading into a more prolonged correction. Keep an eye on the key Fibonacci levels and the behavior around prior wave lows.
Always remember:
Use multiple forms of analysis (trendlines, support/resistance, momentum indicators) for confirmation.
Maintain proper risk management (stop-loss levels, position sizing).
No analysis is foolproof, and market conditions can shift rapidly.
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This analysis is based on typical Elliott Wave principles and publicly visible chart data. It is not a guarantee of future performance. Always do your own research and/or consult a qualified financial professional before making investment decisions.
